Epic Wars: Episode V – The Empire Strikes Back

Note: I am not a lawyer, so this whole post might very well be as good as toilet paper.

I’ve always been very vocal with my displeasure with all-things-Epic. I’ve written countless of forum posts, Facebook comments, some tweets, and even a couple of articles on my old satirical videogames site (in Italian, with some NSFW and generally inappropriate content) about it.

I don’t mind being called a Steam stan: for what it’s worth years ago Steam reignited my love for videogames, and I’ve been a Steam power user ever since. Steam also brought PC gaming back to life, and basically kickstarted the indie golden age, so what’s not to like?

Well, many don’t like their 30% cut. Epic’s Tim Sweeney being the most infamous.
Epic launched their own store snagging exclusives straight from the Steam most wishlisted games, boasting a 12% cut, and depicting themselves as the saviours of the industry.

For many reasons, I wasn’t cool with all that. In particular, I wasn’t cool with their narrative.

But I’m digressing. Let’s move back on topic.

Epic vs Apple (and Google)

While I’m sure Tim Sweeney would have loved to have legal ground to sue Valve for any petty reason, he just didn’t.
So he did what any sane person would have done…

Epic pushed a Fortnite update to both the App Store and the Play Store; it passed both stores’ reviews, and was eventually published.
Soon after, Epic remotely enabled a hidden feature: the possibility to buy the in-game currency straight from Epic for a discount, bypassing the in-app purchases system of both Apple and Google.

This was intentionally in violation of the terms of both stores, a “bait” if you will, because when Apple and Google replied by removing Fortnite from their store, Epic immediately sued both for anti-competitive behaviour.
They also started showing an in-game video riffing on the old Apple’s 1984 commercial, calling out Apple and Google’s monopolistic approaches, and inciting their audience against them with the #freefortnite hashtag.

A couple of days later, Apple went nuclear: if Epic won’t remove the alternative payment method from Fortnite, their Apple developer account will be terminated at the end of the month.
This wouldn’t only affect Fortnite, but also the Unreal Engine, which is used by countless developers for their own products, involving them in a war they might not be super interested in fighting.
To put it simply: if Epic’s developer account is terminated, they won’t be able to update their software for Mac and iOS anymore.

In response, Epic filed a temporary restraining order, asking for this termination to be suspended as it would do irreparable damage to Epic’s business.
Apple responded that the ball is in Epic’s court: they breached the agreement, they can make it all go away by fixing the breach.
Epic counter-responded by scheduling an anti-Apple event in Fortnite.

The hearing about the temporary restraining order happened last night, and the judge appeared very competent in these matters, ruling cautiously against the Epic’s developer account termination.
One of the reasoning is that Epic has different developer accounts, belonging to different companies; unless it’s proven that they are all shell companies of the same corporation, it’s unfair to terminate the developer account behind Unreal Engine, when it’s the one behind Fortnite that’s at fault.
In other words, Fortnite is to be kept off the store, but Unreal Engine is to be left unaffected.

You can read more about the hearing in this very interesting live-tweet thread:

re TRO for Epic — "I am not inclined to grant relief with respect to the games, but I am inclined to grant relief with respect to Unreal Engine"

— sarah jeong (@sarahjeong) August 24, 2020

Monopoly

Both Apple and Google run their stores with heavy hands, doing all they possibly can to keep users inside them, discouraging (or blocking) installing apps from external sources, and forcing developers to only use their payment systems, which in both cases takes a 30% cut off all transactions.

Am I cool with how Apple handles the App Store? Hell no!
Even if I’ve owned Mac computers for more than a decade now, I’ve never had any real interest in the iPhone. I’m a power user, and I need to be free to do whatever I want with my devices.

Am I cool with how Google handles the Play Store? Well, no, but at least I’ve got the option of sideloading apps with a few simple steps.

Epic’s apparent intention is to hit Apple and Google on this issue, just as countless others have done in the past.
But unlike those serious businesses and governments, Epic went ultra gung-ho, turning a significant issue into a marketing stunt, and poisoning the discourse — as they often do.

Audience Weaponization

Is there anything less tasteful than involving your mostly young audience in a corporate war over a bunch of spare billions?
Why yes: involving your mostly young audience in a corporate war over a bunch of spare billions, disregarding the fact that the gaming community at large is already very toxic without any additional help, while depicting yourself as a freedom fighter challenging a fascist state.

Terms of Service

One thing is perfectly clear to me: Apple is acting within their rights, as clearly stated by the terms that Epic agreed to when signed up for an Apple developer account, and published Fortnite on the App Store.

Is having external payment systems a breach of the App Store terms? Yes.
Is hiding features from review a breach of the App Store terms? Yes.
Can Apple terminate any developer account as they please? Yes.
Was Epic perfectly aware of all this when they pulled their stunt? Hell yes!

Epic fabricated the whole situation, then sued, then asked for a temporary restraining order to avoid “irreparable damages” to their business.

If this restraining order were to be approved, it would have created a very awkward precedent, where a company wouldn’t have been able to decide whom to not do business with.

Let’s say there’s a hypothetical social network that states in its terms of service that racist content is not allowed.
Then some racist group signs up, starts posting a ton of racist stuff, and gaining millions of followers.
At some point, the social network admins find this racist group and terminate their account in violation of the terms.
The racist group then sues the social network, and eventually is back on it, spreading their racist content again.

Ok, it’s not exactly the same thing, but still, I’d probably be extremely careful when poking around platforms holders’ rights and duties in this day and age.

Serious Business

Trying to terminate Epic’s developer account is a huge deal, so big that some think it will undermine Apple’s defence.

In my opinion, it was more a statement about Epic professionalism than anything, as if Apple was saying: beware of dealing with Epic, they behave like wildcards, and sooner or later they’ll mess up your own business.
Businesses don’t like chaos; chaos is unpredictable.

Even if Epic is fighting this whole war in good faith, there are much more appropriate ways to fight it than intentionally breaching terms of services as a basis for a lawsuit, while turning it all into a marketing circus.

I’m genuinely sorry for all the developers using the Unreal Engine, who risked to be directly affected by the Epic’s developer account termination. I’ve been an entrepreneur myself (a very bad one, that is), and I know how it feels to receive a curve ball.
On the other hand, businesses are thrown curve balls at all the time, so I’m also kind of inclined to write it off as normal business risk.

The Dreaded 30%

Let’s circle back to this curious number that triggered Epic to go wild to such extent.

The 30% fee is kind of an industry standard; most stores take 30% off all transactions: App Store and Play Store, Steam, and many others.
Epic launched their Epic Games Store to force the industry to lower this fee by proposing a 12% instead, with the reasoning that 30% is just too much.

But is it?

I don’t know, and to be honest, nobody really does.
It definitely feels too much, especially for small indie teams — but we need to provide hard data to back these kind of claims, and unfortunately it’s downright impossible to obtain.

Epic keeps comparing Steam (and now the App and Play Stores as well) to simple payment gateways. PayPal, if you will. Basically a credit card form that you fill, click a button, and receive a payment confirmation email.
But that’s not exactly true, is it?

Steam, like the mobile app stores, provide a slew of features, added value, and R&D that we can’t just ignore for the sake of being the saviours of the industry.

For example, gaining access to a platform with hundreds of millions of users that blindly trust that platform to handle their credit card details, in my opinion, it’s a pretty big added value.
Is it 30%-worthy? That’s a business decision that is supposed to happen before choosing to publish on that platform.

Monopoly (Again)

Whenever Epic does something controversial, Tim Sweeney has always a tweet ready to spin it as something that will save the universe or, at his most humble, benefit the entire gaming industry.

Despite what you might think of Epic, it’s undeniable that, at least for the whole 30% issue, with the Epic Games Store they are putting their money where their mouth is.

What rubs me the wrong way, is that Epic is not really trying to liberate the world from big bad corporations’ monopolies.
Unsurprisingly, given Epic itself is a big bad corporation, they are trying to replace others’ monopolies with their own.

Every time they pay a developer to pull their game off Steam and put it exclusively on the Epic Games Store, they are not really competing with features and innovation, but instead just damaging their competitor.
If Steam were to cease activity today, we would be left much worse off, with a store (because EGS in its current state is just a simple store, a payment gateway if you will, not a full-fledged platform like Steam) missing tons of features, customizations, integrations, accessibility, and general openness.

What would happen if Epic won against Apple?
For a while, I presume that many games will start adding their own custom, proprietary solution for in-app purchases, opening their games and their players to all kinds of security issues.
Eventually, things will settle down, there will be tried and tested options to choose from, and developers will be able to decide if paying the full fee to Apple, or paying some to Apple and some to somebody else.

Epic meanwhile is not-very-secretly pushing for opening its own store on mobile platforms as well, extending its foothold over multiple markets.
While not a bad outcome per se, will we trust Epic to be yet another benevolent dictator ruling over the app space?
Judging from their actions over the last couple of years — years sprinkled with controversies, high levels of toxicity, haphazard lawsuits, marketing stunts, weaponization of their userbase, and involvement of faultless third-parties — I wouldn’t.